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Nigerians Shun Naira For Foreign Currencies To Protect Wealth - Investment - Nairaland

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Nigerians Shun Naira For Foreign Currencies To Protect Wealth by kingsoncj: 1:43pm On Apr 22
Nigerians have been accumulating foreign currencies to protect their wealth from naira volatility and surging inflation, according to a research paper in a journal published by the Central Bank of Nigeria.

“Higher real-exchange rate volatility is associated with an increased level of currency substitution,” central bank economists including Isaiah Ajibola, Sylvanus Udoette, Rabia Muhammad and John Anigwe said in the paper available on the central bank’s website. There is a need to contain “exchange-rate volatility and inflation as a way of curbing the spate of currency substitution in the country,” they said.
One measure of currency substitution, the ratio of foreign cash deposits to naira deposits on demand in the banks exceeded the International Monetary Fund’s 30% threshold from 2009 following the global financial crisis, the researchers said. It hit a peak of 98.2% in 2014 before declining to 83% in 2018. A broader measure of foreign currency in banks to naira savings, demand and term deposits, stayed largely within the IMF limit over the study period from 1995 to 2018.
Africa’s largest economy devalued the local unit twice last year after a crash in the oil price triggered by the coronavirus pandemic hampered revenues. While crude contributes less than 10% to the country’s gross domestic product, it accounts for nearly all foreign-exchange earnings and half of government revenue in the continent’s biggest producer of the commodity.

The naira has lost 66% of its value since 2009 when it exchanged at 149 naira to the dollar. The unit traded at 409.35 naira per dollar at the spot market as of 5:27 p.m. in Lagos on Wednesday. Nigeria’s inflation quickened to the highest level in four years in March and is now more than double the 9% limit of the central bank’s target range.

The central bank previously issued a warning to merchants to stop offering local goods in foreign currency and also banned the practice of accessing the foreign-exchange market for settling domestic transactions.

“The key policy implication of currency substitution is that it reduces monetary policy effectiveness,” the researchers said. “Efforts to further diversify the economy should be of paramount interest to boost the base for foreign-exchange earnings.”

https://www.bloomberg.com/news/articles/2021-04-22/nigerians-shun-naira-for-foreign-currencies-to-protect-wealth

3 Likes 3 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by millomaniac: 3:09pm On Apr 22
Before Nko.
Although no Foreign currency can protect wealth but Naira going by the way people running the country are doing it is increasingly losing value daily. Your best store of wealth is in assets. Naira is a liability!!

63 Likes 1 Share

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by pansophist(m): 3:09pm On Apr 22
Even ghana cedis sef will give your money more value than naira.

24 Likes 4 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Nobody: 3:09pm On Apr 22
In a country where $10,000 equals 4 million naira and you have the man below as president. Bro, high time everyone owns a laptop and work online. cool

150 Likes 8 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Snipespeter: 3:09pm On Apr 22
A
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Leksidebolton(m): 3:09pm On Apr 22
The country is dead already so what do you expect “ when we have 5naira note and 5naira can’t buy anything in the country “ if you are reading this and you’re under 30yrs please find your way out of this Zoo cause the big animals aren’t ready to drop the kingdom for the younger ones

72 Likes 3 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by gurunlocker: 3:09pm On Apr 22
grin


If you have 50 million naira in your bank before 2015, it will be worth 22 million naira today.

87 Likes 6 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by WiszyFraud: 3:09pm On Apr 22
Did you know??

Mosquito repellents don't repel, they hide you. The spray blocks the mosquito's sensors so they don't know you are there.


cool

21 Likes 3 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by yesloaded: 3:09pm On Apr 22
wahala
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by IKBARUTEN11(m): 3:09pm On Apr 22
After the exit of Biafra from the contraption, one dollar will definitely be equal to #10,000 or more




Be wise and go for foreign currencies


Cheers

10 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by royalamour(m): 3:09pm On Apr 22
It is best to save one's earnings, no matter how small in £ and $.
These two currencies have proven to be stable and appreciates more than the Naira.

It is only shameful to blame covid 19 for the free fall of the Naira.
The present Finance minister and CBN governor are two incompetent people.
The fact that unrefined buhari is the president makes things worse.

It is quite unfortunate.

26 Likes 1 Share

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by HenryThegreat1(m): 3:10pm On Apr 22
Hmm
Naira Pele
Na buhari terrible economy policies.
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by nrexzy: 3:10pm On Apr 22
For that to work, the should promote local manufacturing as to strengthen and increase the demand for Naira...

But our people no go gree.... Even people wey Dey away Dey use am cashout

2 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by abkrgumel(m): 3:10pm On Apr 22
Nigerians Shun Nigeria for Canadian visa

11 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Grace001: 3:10pm On Apr 22
The unit traded at 409.35 naira per dollar at the spot market as of 5:27 p.m. in Lagos on Wednesday. Nigeria’s inflation quickened to the highest level in four years in March and is now more than double the 9% limit of the central bank’s target range.

Of course a sane person won’t fold arms and watch millions of Naira in his/her account become worthless against other currencies.

The need to switch to foreign currency can not be overemphasized


2023 is still very far.

3 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by melaniaup: 3:10pm On Apr 22
The country individuals need to speak up

1 Like

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by bravehost4u(m): 3:10pm On Apr 22
We seriously need to print more naira, CBN should do the needful.

Wisdom no go kill me
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by DoctorDree(m): 3:10pm On Apr 22
Before nko
Even the government themselves are stealing in dollars and laundering it out of the country,we all know one day one day 1 dollar go turn 1000 naira.......This country dey fast lane big time,it’s just a timed bomb waiting to explode...........

6 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Drsnives(m): 3:10pm On Apr 22
Shit hole..
I foresee better days ahead despite this shortcomings

This I have seen

5 Likes

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by samwillyco1(m): 3:10pm On Apr 22
Na now una know
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Goldbw122: 3:10pm On Apr 22
I wish all salary of top government officers should be directed to the development of this great country... I know that some people will not agree with me on this, people that have already have the wealth should contribute and make life better for the fellow Nigerian in Nigeria.
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by cassidy1996(m): 3:10pm On Apr 22
I need a Visa
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Nobody: 3:10pm On Apr 22
grin

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by kenny714433(m): 3:10pm On Apr 22
undecided

Who in his right sense will keep naira except for our old parents and unexposed youth? Instead why not risk it in hodling crypto which might give you 50X of your money in the future or you convert it to USDT and bypass NGN inflation.

Thank God our youth are now becoming wiser. If you plot a graph of USD against NGN, you'll observe that the curve has been positive since 1900s and has never for once moved negative direction or attained stability.

From the curve, we can deduct that in 20yrs 1000 NGN will 1USD.
They won't teach you this in school. You need to study money and manipulate the principles of money to make money.

39 Likes 1 Share

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by kolafolabi(m): 3:10pm On Apr 22
That is one of the many reasons our economy is collapsing
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by veekid(m): 3:10pm On Apr 22
Nairaland is trending on twitter
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by horsepower102: 3:11pm On Apr 22
I opened a tread yesterday advising Igbo people to protect their wealth in dollars because of the falling Naira value in addition to transferring their wealth back to Igboland immediately. A moderator closed it.

Ndiigbo take heed of this advices before you shed tears tomorrow.

I single Igbos out because a lot of them are into business and will be really affected with crashing naira value.

Buy land at home (Alaigbo). Invest at home(Alaigbo). Move your savings to dollars.

Aku ruo uno and Aku ruo Dollars is the new mantra

31 Likes 2 Shares

Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by favour32(m): 3:11pm On Apr 22
Yes na!
Wetin concern me with naira controlling my wealth safety?
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Kennyking1234: 3:11pm On Apr 22
D
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Dukeolumidemans(m): 3:11pm On Apr 22
Yep...since 2yrs now. Oh una just dey wake up? grin grin grin tongue
Re: Nigerians Shun Naira For Foreign Currencies To Protect Wealth by Fragility6: 3:11pm On Apr 22
Somebody should please point one sector that works under buhari. Just one o

3 Likes

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